SB 13-140 has been introduced in the Colorado Senate which attempts to nullify any federal statue, rule, or regulation concerning firearms which becomes effective on or after January 1, 2013. The legislation is sponsored predominately by the usual suspects who want federal laws regulating a woman's reproductive plumbing, but God have mercy on you if you regulate their 100 round capacity assault weapon.

SB 13-140 would prohibit any government employee or agency, including law enforcement, from enforcing any future federal law relating to a firearm, ammunition, ammunition magazine, or firearm accessory. In addition, it directs the Colorado Attorney General to defend any resident of Colorado who may be federally prosecuted for violating any future law that may be passed by the federal government regulating their God given right to push lead through that AK-47 until the barrel melts.

And so there's no misunderstanding, SB 13-140 even provides for the arrest and prosecution of "any employee or agent of the United States Government who enforces or attempts to enforce a federal statue, rule, regulation, order, action, or act" concerning the above God given rights.

Now if we could only get a bill like this authorizing the arrest and prosecution of any federal agent or law enforcement official attempting to bust someone for smoking a joint…..

(added a break in the middle for promotion. Interesting… – promoted by ProgressiveCowgirl)

I did a comment last month on the phenomenon of the recent surge of unaffliated registered voters based on some revealing numbers in Larimer County which I published in the comment posts since the numbers were quite a shocker to me. Re-published here.

Those numbers are quite a wake up call – there are more new unaffiliated voter registrations than Democratic, Republican, and other (“third” parties) combined, and by a huge margin.

A couple of days ago I read a national Yahoo story about this phenomenon, it’s occurring everywhere. I also searched on the subject and found numerous stories from local and state sources verifying this is happening in almost all parts of the country.

There has been a long term trend in unaffiliated voters to be sure, but the data clearly indicates this has accelerated dramatically in the last two years and the upswing gets even more pronounced this voter registration cycle.

The reasons for this trend are not clear, but this is definitely something the established parties are going to have to deal with and adapt to, since an increasingly greater appeal will have to be made to unaffiliated voters than the base of the party. I believe I detected this in Romney’s performance in the debate Wednesday evening with some of his talking points geared more to what would appeal to unaffiliated voters at the expense of his Republican base.

So three questions:

1. Why is the unaffiliated surge happening?

2. What ramifications is this going to have long term on the political landscape?

3. And of immediate interest, what effect, if any, do you think this will have on the November elections?

Forty years ago today at 1:00 am a security guard at the Watergate complex in Washington DC noticed tape covering the latches on several doors at the offices of the Democratic National Committee headquarters. Frank Wills removed the tape, but returned an hour later and discovered someone had retaped the latches, and Wills called the police. Five men were discovered inside the offices attempting to install wiretaps on the phones and other bugging equipment. At a hearing the next morning, the five men were charged with attempted burglary and attempted interception of telephone and other communications.

At that hearing, two young reporters who worked out of the city desk at the Washington Post showed up because that’s the kind of story they covered – murders, assaults, burglaries, etc. They had never done any political reporting, but they were good reporters because they asked questions. Bob Woodward and Carl Bernstein did their job.

Frank Wills made $80 a week as a security guard at the Watergate complex. Wills never made much money the rest of his life, and died penniless of a brain tumor in 2000. But in the early morning of June 17, 1972 he did his job.

Richard Nixon resigned the presidency of the United States on August 9, 1974 after having Articles of Impeachment sent over to the Senate for trial. Two days earlier top Republican leaders met with Nixon and told him he might have ten votes in the Senate, with Senator Barry Goldwater bluntly telling him he would vote to convict him and remove him from office.

Richard Nixon had taken an oath of office “to preserve, protect, and defend the Constitution of the United States”. But instead he presided over the most corrupt administration in the history of our country wantonly breaking the law, trashing the Constitution, and attempting to cover it all up. Forty-three Nixon administration officials either plead guilty or were convicted of criminal wrongdoing, including Nixon’s two top aids and his Attorney General who were sent to prison.

Yesterday in Aurora a rally for Initiative 84 was held at the home of Marla Sneed who has fought a long legal battle to stay in her home as a result of what she considers an illegal foreclosure action.

Initiative 84 is a ballot proposal that would simply require real estate transactions to be recorded so constructive public notice is served and a clear chain of title established. That’s the way it used to be in Colorado prior to 2006 when the recordation of documents facilitated a clear chain of title and proper evidencing of parties in interest.

The Colorado Progressive Coalition is spearheading Initiative 84 after the defeat of similiar legislation in the Legislative session under heavy lobbying by the banking industry.

Special interest foreclosure attorneys quietly got the foreclosure law changed in 2006 to allow a bank or servicer to foreclose on a property by simply signing an affidavit saying they are the party in interest authorized to foreclose.

A homeowner being foreclosed on in a Rule 120 hearing has no right to demand original documents be produced to prove the right to foreclose, and in fact they really can’t contest anything.

The “robo signing” scandal evidenced the tactics used by banks in their rush to expediently process the tsunami of defaults in the housing collapse. Documents were fraudulently fabricated and people were paid $ 8.00 an hour to sign documents they were not authorized to sign.

State Representative and CD6 congressional candidate Joe Miklosi was there in support of Initiative 84. Joe is to be commended for taking a stand against the tactics that led to the worst economy we’ve had since the Great Depression and to restore due process in foreclosure proceedings in Colorado – a process that is now deeply flawed and fundamentally unjust.

You can also support foreclosure reform in Colorado and restore the rule of law and protect property rights by signing the petition to place Initiative 84 on the ballot this fall.

The banksters say there’s nothing wrong with the system, it’s working just fine and there’s no need to change anything. But the American people know differently with the collapse of our economy, property values down nationally 30%, and millions thrown out of their homes, many in illegal foreclosure proceedings. And Coloradans who lost their homes with nothing more than than the signature of an attorney representing the lender on an affidavit know there’s something wrong with the system.

The housing collapse and resulting damage to our economy were systemic failures, and can only be averted in the future by changing the system which enabled the crisis. Initiative 84 will be a start to change a broken system and to restore due process in Colorado.

Tuesday afternoon I attended a hearing at the House Economic and Business Development Committee on HB 1156, a bill by Rep. Beth McCann D-Denver that would have reformed the foreclosure process in Colorado.

Currently, a bank or servicer need only produce an affidavit from its attorney stating documents, such as a deed or assignments, exist. They don’t actually have to produce the documents themselves.

McCann’s bill would have banned the use of affidavits and required a court in a Rule 120 hearing to actually examine the documents and determine if they were authentic. It would have also provided for some limited legal challenges to foreclosure – currently there are almost none.

HB 1156 was really all about restoring due process of law in a legal action, an action that has the power to take away someone’s house. Interesting enough, due process was the rule in Colorado until 2006, when a small group of foreclosure attorneys allied with the banking industry quietly got the law changed to allow the affidavit only procedure.

At the standing room only hearing, testimony was heard from homeowners who had lost their homes in foreclosure without ever seeing any documents, even though they had requested them, and documents that had been fraudulently fabricated.

Of course the banking and real estate interests were there, and they testified against the bill saying the system was working just fine and the bill would make banks think twice about making new loans in Colorado.

The bill went down on a 8 – 5 party line vote with the addition of Rep. John Soper, D – Thornton voting to kill.

But the most ludicrous observation was watching the pawns of the banking industry in action.

After Rep. McCann was finished presenting her bill to the committee, Rep. David Balmer R- Arapahoe immediately attacked McCann asking if she was accusing the banks of criminal activity – “the same banks that provide jobs to thousands of Coloradans.”

HB 1156 was about re-establishing due process of law in a legal proceeding, not about jobs. If anything, the banking industry would have to add some jobs if they were required to actually produce the documents they claimed they have in affidavits. And the involvement of these same banks in the financial collapse led to the loss of thousands of jobs in Colorado and a national unemployment rate of over 10%. Obviously Balmer didn’t bring that up.

Nothing like killing a bill with financial blackmail, i.e that it’s a job killer and the banks will stop making loans in Colorado. Regrettably, the rule of law and due process just aren’t that important anymore.

In yet another example of dysfunctional behavior from Congress, a group of Senators want to extend higher Fanny Mae and Freddie Mac guarantee fees to pay for continued cleanup from the British Petroleum Gulf Coast oil spill. Congress has already approved raising the fees by at least 10 basis points effective April 1, 2012.

Guarantee fees are what Fanny Mae and Freedie Mac, often referred to as government sponsored enterprises or GSE’s, charge to purchase single family mortgages and securitize them for offer to investors. The GSE’s currently owe the U.S. Treasury about $151 billion as a result of the financial collapse of the housing market. The higher fees passed by Congress at the end of December were in response to the new funding mechanism for the politically contentious payroll tax cut extension.

Gulf Coast Senators, led by Sens. Mary Landrieu, D- La, and Richard Shelby, R- Ala. have introduced an amendment to the Restore the Gulf Coast Act of 2011 which would extend the fee hike, currently authorized through 2021, for additional monies to be paid into a trust fund for damage repair and restoration paid for only partially by fines levied against British Petroleum.

A tax on homebuyers and consumers

Critics point out using the g-fees to pay for Gulf Coast cleanup, in addition to a revenue stopgap for the payroll tax cut, effectively penalizes potential homebuyers and those looking to refinance existing mortgages at a time when the housing market needs all the help it can get and refinancing is one tool that can be effective in averting foreclosure. The Mortgage Bankers Association CEO David Stevens said in December the increased g-fees could mean an increase of $ 4,000 on a $200,000 mortgage. Currently Fanny and Freddie are involved in about 65% of all new residential mortages.

Predictably, housing interests are pushing back. In a letter to Sens. Harry Reid, D-Nev, and Mitch McConnell, R-Ky, the Mortgage Bankers Association, the National Association of Home Builders, and the National Association of Realtors, stated that “guarantee fees are a critical risk management tool used by Fannie Mae and Freddie Mac to protect against losses from faulty loans. Increasing g-fees for other purposes – even just extending the current fee increase by one year at a lower rate – effectively taxes potential homebuyers and consumers looking to refinance their mortgages,”

According to most observers, the amendment is unlikely to pass given the stiff lobbying of the MBA, the NAHB, and the NAR, but is yet another example of the thought process and special influence legislation that has earned Congress such low public approval and is problematic to the financial predicament we find ourselves in.

Make no mistake – the Gulf oil spill was a tragedy and the damage to the enviroment must be repaired. But to expect the housing business (and ultimately homebuyers and consumers) to pay for it is a gross displacement of financial responsibility. British Petroleum and its contractors should be paying for the cleanup with money paid into the cleanup trust fund. Any additional money paid into the trust fund should be assessed to the extractive energy industry as a whole in the form of a tax or special enviromental assessment fee. This “smoke and mirrors” method of paying for the Gulf cleanup simply illustrates why Congress has a well deserved abysmal approval rating.

Drew “Bo” Brownstein, son of power broker attorney and lobbyist Norman Brownstein (Ted Kennedy once called Norman Brownstein the 101st Senator) was supposed to be sentenced this week in a New York federal court for securities fraud. Bo Brownstein illegally used inside information to net a $ 2.4 million profit on the information.

Bo Brownstein was head of the Denver based Big 5 Asset Management hedge fund, and has been an executive at Credit Suisse bank in New York.

The sentencing has now been put off several times while the old man is pulling levers and calling in his markers to ensure baby Bo doesn’t do any jail time. The initial plea bargain deal was for a sentencing range of 3 to 4 years. But as the wheels of injustice churn, it looks like Bo might get off with a slap on the wrist.

Although the maximum jail time for this offense is 20 years, Bo’s attorney’s are negotiating a no jail time deal in which Bo will do 500 hours of community service at National Jewish Hospital here in Denver. Dr. Michael Salem, president and chief executive at National Jewish, has written the court recommending that Bo do no jail time and would be welcome to do his “community service” sentence at National Jewish.

Norman Brownstein is on the board of directors of National Jewish and has been for many years. No doubt the staff of National Jewish will be honored to have baby Bo amongst their ranks, where he will probably be given a corner office to perform his “duties”, complete with internet service so he can keep up with news of the financial markets.

Co-conspirator Clay Peterson, who headed Arthur Andersen’s Denver office in the 1990’s, was sentenced to two years probation and no jail time.

Steal $100 from a 7/11, and you’re looking at 3 to 5 down in Canon City. And if you honk your horn in solidarity with the Occupy Wall Street movement, you get a ticket. But if you steal $2.4 million on Wall Street and your name is Bo Brownstein, no problem, daddy will make it all better.

I got to Civic Center at noon and strolled through the crowd encountering a whiff of Mary Jane (better than a whiff of grapeshot I suppose). Shortly thereafter we proceeded to head down to the 16th St. Mall with various chants like “We are the 99 per centers !” and “This is what democracy looks like !”.

It was a pretty large crowd (someone told me maybe 5000, but I dunno). We assembled in front of the Federal Reserve and various speakers spoke, then it was on to 17th Street in front of Chase and up 17th back to Broadway and returned to Civic Center. I was carrying an anti-war poster that said “no more endless wars” and when passing by the Denver Post building saw the news ticker say US troops are now going to stay beyond the withdrawal deadline date in either Iraq or Afghanistan (didn’t see which). Oh well, looks like the “endless war” carries on.

The crowd was definitely a mixed bag, running the gamut from activist liberals, union types (someone told me there were a lot of teachers marching, but again I can’t confirm this), “greenies”, , some Ron Paul supporters, and the usual “hippies” and anarchists.

But the central theme tying the diverse crowd together was a vehement dislike of a political establishment perceived as firmly in the pockets of the corporatists , and a palpable contempt for the banks and the “too big to fail” crowd. Signs bemoaned the corruption of corporate money in the political process (one sign said “Who’s bitch are you today, Legislator?), an end to the wars, universal single payer healthcare, and an end to the war on drugs.

But make no mistake, something is happening here, although it’s still not exactly clear. Having come of age during the Vietnam War and getting progressively militant in my opposition to that war as time went on, I sensed the same “fuck the establishment” karma I felt back then. It’s just not the financial meltdown and the now 3 year old tanked economy with unemployment stuck above 9% , it’s a lot of shit going down that people are just fed up with and they are starting to see the connects between it all. In this sense, I thought of the path Martin Luther King took in the couple of years before his death, as he moved beyond the issue of civil rights and came out in opposition to the Vietnam War and pushed for economic justice. King knew that “guns and butter” was a fallacy, that there could be no just society in our country unless the issues of the war and economic injustice were addressed. I believe the same “guns and butter” mentality got us into our current economic mess – that we could conduct two wars financed on our Chinese credit card and everybody could own a home (or move up to a bigger home) regardless of their ability to actually afford it.

As diverse as the crowd was over as many issues, the predominant thread was ” We’re mad as hell and we’re not going to take it anymore.”

Where this is going or how it plays out politically is hard to guess. Although the issues seem to play in favor of Democrats, this crowd had equal contempt for both parties (there were plenty of signs bashing Obama). The younger people especially seemed to have no use for either party, and most likely are unaffiliated and if they vote at all, will vote for a candidate ignoring any party label. I found the young speakers remarkably well informed about the fraudulent tactics the banks pulled off that ultimately brought the economy down, and the phrase “fool me once, shame on you – fool me twice, shame on me” applies here.

When President Obama addressed the joint session on Congress last week rolling out his new jobs bill (which hasn’t yet been introduced in Congress), he briefly addressed the continuing housing crisis which is hampering economic recovery.

“We’re going to work with federal housing agencies to help more people refinance their mortgages at interest rates that are now near 4 percent. That’s a step that can put more than $2000 a year in a family’s pocket, and give a lift to an economy still burdened by the drop in housing prices”

But House Dems as of Friday were not impressed with Obama’s lack of action at odds with the rhetoric. According to Rep. Dennis Cardoza (D-CA), as reported in The Hill.

“The administration has been AWOL on this issue and the American people are suffering because of the mismanagement. In my entire political career, I’ve never seen anything this irresponsible.

House Democrats led by Cardoza and Rep. Elijah Cummings (D-MD) requested a meeting with Edward DeMarco, acting director of the Federal Housing Finance Agency, the entity formed in 2008 as conservator of the GSE’s Fannie Mae and Ginnie Mae which were insolvent and have cost the taxpayers $145 billion so far.

But DeMarco would not meet with them, instead sending lower level employees who could not answer their questions.

Since the FHFA is an agency independent of the White House, it’s questionable how much control Obama may have over the FHFA, but it appears the administration is rudderless when it comes to specifics about new initiatives to deal with the mortgage mess in which 22% of all loans are now underwater.

According to Cordoza, at a June meeting with the Democratic Caucus, the president promised a significant housing initiative in September, but has only delivered words and not action. Referring to the administration programs such as HAMP which have fallen far short of expectations, Cordoza said “the programs that were put in place were abysmal failures”.

Meanwhile over in the Senate, Senators Barbara Boxer (D-CA) and Johnny Isakson (R-GA) have introduced a bill to eliminate the loan-to-value restrictions and fees for refinancing Fannie and Freddie loans into lower rates. This tactic would address what has been obvious for too long, i.e the devaluation of housing prices which is scuttling an economic recovery.

However this is going to cost the federal treasury more money, and the banksters want it tied to a waiver of the representation and warranty risks so they get off the hook for their malfeasance and fraud. (The civil suits FHFA filed against the major banks and servicers a couple weeks ago are rep and warranty claims).

So as politicians of all stripes scramble to do something to fix the housing mess with the election looming next year, the frustration that little done so far has made much of an impact is apparent. Boxer implored her fellow lawmakers on Wednesday to do something and “get in front of this crisis for once”.

But so far, the housing and mortgage mess seems to have a life of it’s own, like a malignant tumor that no amount of radiation can kill.

“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and the corporations that grow up around the banks will deprive the people of all property until their children wake up homeless on the continent their fathers conquered.” Thomas Jefferson

“The banksters in effect issued their own currency in the form of collaterized debt obligations (CDO’s) which were ostensibly securitized by property. As the foreclosures continue to roll, more Americans everyday wake up with their property gone and homeless. You can’t say we weren’t warned.”

allyncooper

Last fall in the wake of the “robo-signing “scandal and other egregious practices by big banks concerning foreclosure procedures, the same ones who were deemed “too big to fail” and got bailed out by the taxpayers, the attorneys generals from all 50 states and some federal agencies launched an investigation of the big mortgage servicers into the well documented faulty foreclosure procedures. Predictably, some of the AG’s have been more aggressive than others (Colorado AG John Suthers can be put in the “less aggressive” category, perhaps even as MIA) in investigating and pursuing wrongdoing in the mortgage mess which is at the core of the countries housing meltdown.

It now looks like the Obama administration has joined ranks with those pushing for an agreement which would grant immunity and hold the big banks and servicers harmless from future liability and litigation in the mortgage mess. And the incestuous relationship between the agencies charged with regulation and the banking industry is being exposed as well, with the agencies having clear conflict of interests in the matter.

Unfortunately, it looks like the interests of the big banks and servicers may prevail, flexing their economic and political power to stifle any accountability of their actions.

The state AG’s that have said no to any deal that gives the banks a “get out of jail” card are led by New York AG Eric T. Schneiderman and include Massachusett state AG Martha Coakley and some others. Schneiderman so far has held his ground saying “no deal” to a settlement that would let the five largest institutions involved – Citigroup, JP Morgan Chase, Wells Fargo, Ally Financial Inc., and the dirtiest of the dirty, Bank of America – off the hook for future liability for a reported $20 billion settlement. Sources also say the $20 billion would be structured for loan modifications and principal reduction on existing mortgages, so such a scenario would encompass the good, the bad, and mostly the ugly.

Bank of America spokesman Lawrence Grayson stated “We continue to believe the best way to get the housing market going again in every state is a global settlement that addresses these issues fairly, comprehensively, and with finality ” . What a crock. The reality is, the housing mess isn’t going to get any better with the “settlement” B of A and the other banksters desperately want. It’s a slap on the wrist, and a paltry sum to pay for the real gem handed to the banksters on a silver platter -immunity from any further investigations, civil liability, and potential criminal prosecutions.

The 50 state AG investigation was prompted by the “robo signing” scandal and other foreclosure “irregularities”by the banksters, which Connecticut AG Richard Blumenthal characterized as “at best careless negligence and at worst, outright fraud”. But Schneiderman wants to enlarge the probes investigating Wall Street’s and the banksters role in the packaging and securitizing of risky mortgages, which was facilitated by the establishment of MERS (Mortgage Electronic Registration System) in 1995. Another issue to be investigated is the credit rating agencies issuing AAA ratings on this junk.

State AG’s Martha Coakley (Massachusetts.), Beau Biden (Delaware), and recently California AG Kamala Harris has expressed solidarity with Schneiderman’s desire to continue the investigations. Harris has subpoenaed Citigroup, and its banking subsidiary Citibank to produce documents and answer questions about the selling and marketing of mortgage backed securities in California.

But that’s the last thing the banksters want. Sources report they are getting backup from the Obama administration pressuring Schneiderman , through HUD Secretary Shaun Donovan and high level Justice Department officials (no surprise here, Eric Holder, the top federal law enforcement official has been “invisible ” in all this) – to accept a settlement that would release the banksters from all future liability in the biggest financial scandal ever that destroyed our economy.

Even the Fed is in on the coverup, with Kathryn S. Wylde, member of the board of the Federal Reserve Bank of New York and president of the Partnership for New York, a non profit organization of city business leaders stating to Schneiderman…..

“It is of concern to the industry that instead of trying to facilitate resolving these issues, you seem to be throwing a wrench into it. Wall Street is our main Street – love ’em or hate ’em. They are important and we have to make sure we are doing everything we can to support them unless they are doing something indefensible”

Earth to Wylde. How would you know they did something “indefensible” in the first place , when all investigations are squelched by the deal the banksters and the Obama administration are pushing? Even though the real fraud occurred on Wall Street (the securitized financial instruments, the CDO’s, bogus credit ratings, etc.), just move on folks, there’s nothing to see here.

Financial analyst Barry Ritholtz had this to say on his The Big Picture website about the obvious conflicts in play…..

Note that the Federal Reserve (and indirectly, the NY Fed) are conflicted players in this. On the one hand, they are supposed to be bank regulators (a task they have performed poorly). They are also substantial investors in the banks, and their regulatory oversight role is obviously conflicted.

There have been all manner of criminal and civil trespasses committed, and we should find out who ordered them, who committed them and why. AG Schneiderman should continue investigating the robo-signing, bring civil and criminal charges where necessary.

Recall that the original problems came about in large part due to Alan Greenspan’s Nonfeasance – the failure to perform his professional obligations of oversight and regulation. That any member of the Federal Reserve or NY Fed wants this closed before any investigation has been undertaken is a scandal of the highest magnitude.

The Obama administration , facing a tough re election battle in an anemic economy, has cast it’s lot with the banksters and corporatists. Evidently it’s better to coverup the festering wound and give those who should be held accountable get out of jail cards than hold them responsible. Scratching that wound during an election year is only going to make for a steady stream of bad news, and since “ignorance is bliss”, it’s better to squelch the investigations and just stay ignorant …..until the same players bring us down the next time.

Too big to fail….too big to be held accountable. Welcome to the new Amerika.

As the political rhetoric heats up for the 2012 presidential election, there’s little doubt the overriding issue will be the economy. Presidential candidates live or die by the state of the economy and by the perception they can do something about it or are ineffective in economic matters. Nobody knows this better than Obama, who was swept into office by a rapidly deteriorating economy. George H.W. Bush found this out the hard way when he woke up the day after his re-election bid and belatedly acknowledged James Carville’s astute observation – “It’s the economy, stupid”.

The recession has been “officially” over for months, with the stock market up , most large corporations making good earnings, and the tech and auto industries rebounding. But on main street , unemployment remains stuck above 9%, state and local governments continue to layoff workers and cut services, many small businesses are struggling, and consumer confidence remains anemic.

Housing continues to be the major drag on recovery. Four years after the bubble burst, housing prices are continuing to decline fueled by a continuous supply of foreclosures , and more and more homeowners find themselves “underwater”, owing more on their mortgage than their house is worth. Since the market peak in 2007, the total value lost in the residential market is a whopping $9 trillion. Nothing has hit the middle class harder, because the bulk of its wealth was in the roof over their heads.

Historically, a housing recovery has led the way out of previous recessions. Housing has a multiplier effect triggering the purchase of other major consumer products, like appliances and furniture. But the indices simply aren’t there to indicate any turnaround in housing anytime soon, certainly not by the election next year, and perhaps not for years after that.

It’s been said the three most important words in real estate are “location, location, location”. But three other words are becoming increasingly important – “inventory, inventory, inventory”. Gary Shilling, the housing consultant who predicted the housing bust and has been right more often in his pessimistic outlook on the market, recently said housing prices will likely drop another 20%. Moreover, the percentage of homeowners with loans underwater may increase from the current 25% to 40% – a wave of “strategic foreclosures” could be on the horizon – people who still have jobs and can pay their mortgage but walk because they no longer see the value of paying on a house not worth the note. Shilling even predicted this could lead to a new recession in 2012.

Inventory is the important indicator. “Normal” inventory nationally is about 2.5 million units. Current inventory is 4.0 million, and going up. The “shadow inventory” refers to the number of loans in foreclosure or 90 days delinquent, and that number currently totals 4.3 million loans, representing units that will be dumped on the market at some point in the future adding to the already huge inventory glut. In addition to this “shadow market”, there is yet another “shadow market”, owners who would put their houses on the market but aren’t because they are underwater or simply can’t see the value of trying to sell in a depressed market.

Adding to housing’s woes is the fact there is simply a smaller market for housing now. Credit and finance restrictions put in place by Dodd-Frank have culminated in what’s known as a Qualified Residential Mortgage requiring a 20% down payment, a provision the National Association of Realtors and the NAHB is fighting tooth and nail. Because of this and other credit restrictions on mortgages, the number of eligible buyers is dwindling while inventory is increasing.

The Obama administration initially launched the HAMP program in February 2009 to help struggling borrowers refinance and stay in their homes, but it’s been a big disappointment. It also failed to address what is now the bigger problem – underwater loans. FHA launched the $ 8 billion Short Refinance program in September in which underwater borrowers can refinance into an FHA insured loan if the lender writes off the unpaid principal balance of the original loan by at least 10%, but as of June only 246 borrowers took advantage of it .

In the past few weeks, Obama has turned his attention back to housing, no doubt aware of the bleak situation and the ramifications it may have on his re-election. At a Twitter town hall meeting two weeks ago, Obama said he would put more pressure on banks to pursue principal reduction, acknowledging property devaluation as the crucial issue. HUD has accelerated implementation of a $1 billion mortgage assistance program to the unemployed mandated by Dodd-Frank, but it could be a drop in the bucket given the enormity of the problem. Last week on Meet the Press, Treasury Secretary Timothy Geither admitted the administration may be running out of options “to engineer artificially a stronger recovery” in the housing market .

The economy will be the overriding issue in the presidential election next year. Obama is a smart man and doesn’t have to be told, “It’s the economy, stupid”. But he may be running out of options to “fix” the housing crisis, not through lack of trying, but simply because the problem is so systemic little can be effectively done by government. But politics is perception and the pain is real with that $9 trillion in wealth gone predominately from the middle class. The election could very well hinge on who gets blamed for that pain.

SB 172 is now before your committee for consideration to the Committee of the Whole. As you well know, SB 172 would provide in statue authorization permitting two unmarried adults to enter into a civil union.

There are those well-meaning fellow Coloradans among us who say the time is not right for this bill. They say given the current economic conditions, when our unemployment rate is now at 9.3%, and the state continues to have serious budget problems and faced with draconian cuts in services and aid to education, we need to put this bill on the shelf and perhaps revisit it in the future.

To those who say the time is not now to enact SB172 into law to ensure the basic civil rights of all Coloradans to live their lives as they wish and responsibly provide for the means to do so, then when? Shall we postpone the granting of legal process and protection to all of our citizens until the unemployment rate is 5%, or until the housing crisis is over, or until the Legislature doesn’t have to deal with a billion dollar deficit every session? Just what shall be the criteria? Such reasoning is disingenuous and illogical, because the denial of the civil rights of any of our citizens cannot be subrogated to the economy or any other extraneous issue.

On April 16, 1963 Martin Luther King sat in a Birmingham jail and penned a letter to fellow clergymen who had criticized his activities of ending discrimination in that city as “unwise and untimely”. He was questioned why he had chosen that time and place, why he just didn’t back off and wait because discrimination and segregation would eventually be recognized for the wrongs they were. Martin Luther King’s response was simple and direct – “I am here in Birmingham because injustice is here”.

King went on to say in his letter “For years now I have heard the word “Wait!” It rings in the ear of every Negro with piercing familiarity. This “Wait” has almost always meant “Never.” We must come to see, with one of our distinguished jurists, that “justice delayed is justice denied”.

Martin Luther King knew the time had come.

In the first two years of his presidency, John F. Kennedy cautiously tread a fine line between tepid support of civil rights and appeasing the segregationist Democratic legislators in Congress whose support was essential to passage of his legislation.

But by the spring of 1963, with Martin Luther King jailed and the consequences of that justice delayed and denied becoming more pronounced with the murders, beatings, and bombings, Kennedy addressed the nation on June 11, 1963 on television.

“We are confronted primarily with a moral issue. It is as old as the scriptures and as clear as the American Constitution”. Kennedy went on to say the injustice and the discrimination of the Negro could no longer be tolerated and that “the nation, for all its hopes and all its boasts, will not be fully free until all its citizens are free. Now, the time has come for this nation to fulfill its promise”.

A day after Kennedy’s speech, civil rights activist Medgar Evers, a veteran of the D -Day invasion at Normandy, was shot in the back and killed in front of his wife and children. On June 19, 1963 Kennedy submitted to Congress the most far reaching civil rights bill in the nation’s history.

John F. Kennedy did not live to see this nation fulfill its promise, but he knew the time had come.

I happen to be heterosexual, and I believe that’s the way my Creator made me. Just as I believe the Creator made some of my fellow human beings a different sexual orientation, or a different race. And who am I to question that? Do I know better than my Creator? My sexual orientation should be of no more concern to you than yours’ is to me or anybody else. We are all children of God, and we all have a right to be here and live our lives with those we love and care for and choose to call our family with equal protection under the law. This is the fundamental essence of our society that binds us together as one nation under God, with liberty and justice for all.

At the 1948 Democratic Convention, Hubert Humphrey passionately argued for a strong civil rights plank proclaiming “the time has come…..to walk forthrightly into the bright sunshine of human rights”. Colorado is blessed with abundant sunshine, and the time has come to make it even brighter by recognizing the human rights of all our citizens.

Members of the Committee, I urge you to favorably act on SB 172 for consideration by the Committee of the Whole.

In the ongoing effort to “trim the fat” in the federal budget and terminate programs that are deemed ineffective, House Republicans are looking to eliminate housing programs that were put in place to address the foreclosure crisis.

House Financial Services Committee Chariman Spencer Bachus (R-Ala.) has scheduled hearings this Thursday on legislation that would terminate three programs that are supposed to help struggling homeowners avoid foreclosure and another designed to buy up and rehab foreclosures in distressed communities.

The program most under fire is the Obama administration’s ambitious Home Affordable Modification Program (HAMP) that was funded through the original TARP program. Launched in March of 2009, the program was supposed to assist up to 7 million homeowners avoid foreclosure by providing lending institutions incentives to modify mortgages to lower the interest rate and thus the monthly payment.

However the program has fallen far short of its goal. Last year the Inspector General for TARP issued a report saying there have been fewer than 400,000 permanent modifications through June of 2010. The program has been criticized as unwieldy and cumbersome, with financial institutions not effectively participating and homeowners not following through on program requirements resulting in a high rate of defaults.

The Inspector General’s report gives critics ample ammunition for termination of the program, saying “the refusal to provide meaningful goals for this important program ………makes it difficult to assess whether the program’s benefits are worth its very substantial cost”. The report goes on to say the program “has failed to put an appreciable dent” in foreclosure filings this year (2010).

As of the June report of 2010, the HAMP program had accomplished fewer than 400, 000 permanent modifications. Part of the ineffectiveness of the program is it does not address what is now the bigger problem in the housing market – the devaluation of housing prices. A growing number of homeowners find themselves “underwater” owing more on their mortgage note than their house is worth (two-thirds of all homeowners with loans on their property are underwater in Arizona). And the program does nothing to help someone who has lost their job and becomes another statistic in the stubbornly high unemployment rate.

Two other programs targeted for elimination by House Republicans is an FHA mortgage refinance program (just 35 applications by December of 2010) and a HUD Emergency Mortgage Relief program funded at $1 billion.

The forth program that could be axed is the Neighborhood Stabilization Program (NSP) administered through the HUD Community Development Block Grant program (CDBG) . NSP was hatched by the Bush administration in its first response to the foreclosure crisis and initially provided $ 3.9 billion for block grant communities to buy up already foreclosed properties in targeted neighborhoods, rehab the properties, and put them back on the market. The theory was to address the blight and decline of property values in the targeted neighborhoods. More funds were added to NSP by the Obama administration (usually referred to as NSP2) funded by the stimulus bill.

The City and County of Denver, Aurora, and Adams County as entitlement communities under their CDBG programs are administering the NSP funds, so the Republican plan to kill the program and rescind the $1 billion appropriated but not yet spent will no doubt have local ramifications.

Given the ongoing housing crisis in which it seems little done so far has helped, the House Republicans have ample argument for eliminating these programs which by objective analysis have proven marginal in addressing a problem that has defied a solution for the past several years and continues to dampen economic recovery. It will be interesting to see how this plays out on Capitol Hill this week.

I don’t know if it’s been mentioned here before (I haven’t seen it but then I don’t catch everything on Pols). But this is something that bears repeating for us all.

Our Colorado Statehouse, the physical embodiment of our democracy, is in dire need of our help. The dome is in such disrepair that it has been closed for years. Deferred maintenance isn’t an option, the structure will only continue to deteriorate if nothing is done.

Unless you’ve been living under a rock (and maybe you have if you were foreclosed on) you know our state has been financially stressed the past few years, and this year is no better.

Since the state has few resources for the repair work, a Share in the Care campaign has been initiated to invite citizen participation in contributing to the restoration of the People’s House. This campaign is modeled after the effort to restore the Statue of Liberty in the 1970’s.

We here at Pols actively participate in the democratic process by our lively and unrestrained

discourse on politics and the manner in which we govern ourselves. And we the people, through our elected representatives who meet at the People’s House, must do the same. This is the essence of our democracy.

Here is the Share In The Care website where you can find more information on the campaign. Please consider contributing what you can. Thanks.